loss

Definition of loss

2a: the act of losing possession :deprivationloss of sightb: the harm or privation resulting from loss or separation bore up bravely under the loss of both parentsc: an instance of losing His death was a loss to all who knew him.

3: a person or thing or an amount that is lost: such asalossesplural: killed, wounded, or captured soldiers His regiment suffered terrible losses.b: the power diminution of a circuit (see 1circuit 4a) or circuit element corresponding to conversion of electrical energy into heat by resistance (see 1resistance 4a)

4a: failure to gain, win, obtain, or utilize loss of a gameb: an amount by which the cost of something exceeds its selling price The railroad claimed to be operating at a loss.

5: decrease in amount, magnitude, or degree a loss in altitude

6: the amount of an insured's financial detriment by death or damage that the insurer is liable for

at a loss

1: uncertain as to how to proceed was at a loss to explain the discrepancy

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'loss.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of loss

Middle English los, probably back-formation from lost, past participle of losen to lose

How It Works

Note that this formula assumes the purchase price is higher than the sale price. If an investor sells an asset for more than he or she paid, this is called a capitalgain.

Let's assume you purchase 100 shares of XYZ Company for $5 per share. After three months, the share price decreases to $1. This means the value of the investment has decreased from $500 to $100, for a capital loss of $400.

Why It Matters

Capital losses are generally tax deductible, but only when they are realized. That is, they only become deductible when the asset is actually sold (unless the stock is legally deemed worthless). Until that point, any losses are considered unrealized and are not deductible. The IRS considers nearly every asset owned by individuals and companies as capital assets and thus subject to capital gainstaxes and capital loss deductions.

Taxpayers report capital losses on IRS Schedule D. An investor's capital losses will sometimes offset all or a portion of his or her capital gains, lowering the investor's tax bill. There is a limit to how much the investor can offset (generally $3,000), but remaining losses can typically be carried over to future tax years. To prevent trading for the sole purpose of tax avoidance, the wash sale rule prevents investors from deducting capital losses on a security if they purchased a "substantially identical security" within thirty days before or after the sale.

Many analysts claim that the deductibility of capital losses encourages tax-loss selling during November and December of each year, which in turn fuels the "January effect," which is a tendency for the market to rise during that month. Analysts believe this is the case because the wash sale rule requires investors who sell stock for tax-losses in November and December to wait at least thirty days to repurchase those shares.

LOSS Defined for Kids

loss

Definition of loss for Students

2: harm or distress that comes from losing something or someone We all felt the loss when he left.

3: something that is lost weight loss

4: failure to win It was the team's first loss.

at a loss

: unsure of how to proceed

Law Dictionary

loss

noun

Legal Definition of loss

1: physical, emotional, or especially economic harm or damage sustained: as a: decrease in value, capital, or amount — compare gainb: an amount by which the cost of something (as goods or services) exceeds the selling price — compare profitc: something unintentionally destroyed or placed beyond recovery d: the amount of an insured's financial detriment due to the occurrence of a stipulated event (as death, injury, destruction, or damage) in such a manner as to create liability in the insurer under the terms of the policy Editor's note: As a general rule, economic losses are deductible from adjusted gross income under section 165 of the Internal Revenue Code. There are, however, numerous exceptions and limitations.actual loss: the identifiable and calculable monetary detriment that is suffered or will be suffered as a result of an act or eventactual total loss: a loss in marine insurance in which the property (as a vessel or cargo) cannot be repaired or recovered — compare constructive total loss in this entrycapital loss: the amount by which the book value of a capital asset exceeds the amount realized from the sale or exchange of the assetcasualty loss: loss of property as a result of a fire, storm, shipwreck, or other catastrophic eventconsequential loss: a loss that arises as an indirect result of an act or event —called also indirect loss — compare direct loss in this entryconstructive total loss: a loss in marine insurance in which the cost of repairing or recovering a ship or its cargo would be more than the ship or cargo is worth — compare actual total loss in this entrydirect loss: a loss arising directly from an act or event — compare consequential loss in this entryindirect loss:consequential loss in this entrynet operating loss: the amount by which the expenses of operating a business exceed the income derived from it — see also carryback, carryoverordinary loss: a loss from the sale or exchange of any asset that is not a capital assetpartial loss: a loss arising from damage to property that does not render it a total losstotal loss: a loss arising from damage to property that is so substantial as to make the property valueless to an insured

2: the act or fact of suffering physical, emotional, or especially economic harm or detriment